Andy Wood, Managing Director, TotalDM You Asked What are the multi-channel loyalty schemes and how are they used by the different sectors?

The theory of Customer Relationship Management (CRM) by definition embraces the importance of channel management. It is usually defined as “managing relationships with customers efficiently and consistently across all channels to improve satisfaction, retention and profits.”

So, what is the consumer to think of an enquiry centre that cannot use their loyalty registration to call up a profile of recent purchasing? Why should the consumer favour an organisation that allows points redemption in-store but not online?

Not that we should expect every single loyalty scheme to operate across all channels, however. Channel mix is determined by audience preferences. For instance, only a tiny proportion of some vendors’ audiences have Web access at home (remember that only half the population does).

Equally, there are other audiences that have no interest in a high street presence and want to deal exclusively by remote media such as phone and internet. However, in most cases, an organisation will want its loyalty scheme to be consistent whatever channel the customer is using.

Research commissioned by TotalDM amongst the UK’s top 1000 company marketers, completed in September 2005, has revealed that just under a third of those companies that have loyalty schemes treat the customer consistently across all channels – mail, phone, Web, SMS and face-to-face. This means that conversely two thirds of UK top companies are potentially undermining the value and return on investment from their loyalty schemes.

Credit card issuers, retailers and travel companies turned out to be best at spreading their loyalty schemes across all channels to the customer. This means that they enable points earning and redemption to cover all customer activity, whether it is online, over the phone or in person. Interestingly, these sectors are all pioneers in loyalty management.

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